Nominal GDP

"Everything's Interconnected"

Everything happening today is in some ways interconnected: popularity of ‘non-establishment’ political candidates; ineffectiveness of central bank policy in lifting inflation; economic pessimism; weak capital spending (from handcuffed capitalism); and angst due to perceptions of inequality. Let us explain...

This Is The Last Stage Before Recession

The probability of recession is increasing. Contrary to popular belief, the beginning of a recession is not deflationary but the exact opposite. We expect a recession by the end of 2016, and if that projection turns out to be wrong due to a massive turnaround in Fed policy, the cataclysmic event will only be postponed till 2017.

Gold Money's picture

In his annual newsletter to shareholders, Buffett makes the argument that $56,000 today is six times better (even after his adjustment for inflation) than the $858 of GDP per Capita each US Citizen earned in 1929 but forgets to mention that $858 in 1929 was equivalent to 41.5 Troy Ounces of Gold in 1929. When measuring on an apple to apples comparison, there has been little to no gain in GDP per capita over the last 86 years in the United States. We show you the math.

G-20 Needs To "Man Up" Or Risk Sparking Market Chaos, Citi Warns

“Keeping the previous language would be very disappointing and would be viewed as either complacent or reflecting policy paralysis. [They need to] man up and tell member countries that monetary policy should be accompanied by fiscal expansion.”

How Italy Will Fail And Drag Down The European Project

Italy is big enough to matter (it is the eight largest economy on the planet), but so uneventful that most does not pay any attention to what is going on there. We contend that Italy will, during the next year or two, be on everyone’s radar screen as it has the potential to derail the European project for real.

"Everything Changes At Zero" - Investors "Obligated" To Fight The Fed

The financial world is growing increasingly crazy-looking. What is alarming is that central banks are brandishing these new tools without any viable evidence or theory that they will even work. This itself presupposes that central banks have any idea of what “work” might even mean in this brave new context. It used to be said, ‘Don’t fight the Fed’. Now as investors, if we want to protect our capital, we are all obligated to fight the Fed, and its international cousins, with whatever we have.

Forget "The Great Moderation", This Is "The Great Intellectual Failure"

History might look back on this period as a great intellectual failure for not properly understanding the dynamics. The Fed should spend more of its intellectual power trying to understand why its policy actions have not had the desired or expected result. Market pundits arguing for easier money (or negative rates) do not fully understand the long-run unintended consequences to markets and economies from extreme and long periods of unconventional monetary policy. Market turbulence today is a warning sign.

NIRP Won't Work - What Ray Dalio Thinks Central Banks Will Do Next

While negative interest rates will make cash a bit less attractive (but not much), it won’t drive investors/savers to buy the sort of assets that will finance spending. And while QE will push asset prices somewhat higher, investors/savers will still want to save, lenders will still be cautious lenders, and cautious borrowers will remain cautious, so we will still have “pushing on a string.” As a result, Monetary Policy 3 will have to be directed at spenders more than at investors/savers.

China Unleashes A Debt Tsunami: Creates $1 Trillion In Debt In First Two Months Of 2016

New loans so far in February were similar to the levels during the same days of January. The total so far in February is seen at around CNY2 trillion already.  This means that if the TSF components rose at a comparable rate as in January, then the total increase in aggregate Chinese debt is on pace to surpass CNY6.5 trillion, or $1 trillion in new debt created in 2 months!

dazzak's picture

THE SUM OF ALL FEARS

Because so much is riding on what so few decide,once the faith in the Central Banks fail, the chances of us getting out of this diminish every second...

Robust Job Growth Doesn't Make Sense And The Numbers Show Why

There is no productivity mystery, only a distinct and illegitimate lack of curiosity on the part of economists to simply take the Establishment Survey as gospel regardless of how little it fit the rest of the world. It also calls into question the legitimacy of the FOMC and monetary policy that was certainly subject to, and predicated upon, the same quackery. No matter how little the payroll reports described the economy as it was, including the relation to GDP, they held on to nothing else to instead deny everything.